Header Bidding = Better Bidding

November 7, 2020

Header bidding isn’t new technology, but many publishers are reluctant to implement header bidding due to concerns about complexity and maintenance. We’re doing a deep dive into header bidding to show publishers why header bidding is better bidding.

What is header bidding?

Header bidding is a programmatic advertising technique that allows publishers to offer each impression to multiple ad exchanges simultaneously. Header bidding has gained popularity as an alternative to the traditional demand waterfall, in which publishers offer inventory to ad exchanges and SSPs by passing impressions from partner to the next until a bid is accepted. 

What are the benefits of header bidding?

Header bidding offers a number of advantages over the demand waterfall. 

Exposure to more buyers

Including more ad networks and supply-side platforms (SSPs) in the auction exposes a publisher’s inventory to more advertisers, and increases the chance that each impression will have an interested buyer. Advertisers have different criteria for defining a valuable impression, and often use remarketing and cookie matching to reach their audiences. Including a variety of advertisers, via a diverse set of ad networks, exchanges, and SSPs in the auction, gives publishers the best opportunity to find a buyer for each impression.

Higher revenue

Offering inventory to a number of ad networks and SSPs at once creates auction pressure and results in higher bids. Imagine an in-person auction, where buyers raise paddles to bid on items. As a seller, would you prefer to see a room full of potential buyers, furiously waving their paddles to bid against the other buyers, or would you rather see a single buyer, who handily scores your item by meeting the opening bid? Header bidding is similar; having multiple ad networks, exchanges, and SSPs at the auction increases competition for every impression.

Reduced loss

The traditional demand waterfall often resulted in lost and unfilled impressions. As impressions in a waterfall are passed from partner to partner, looking for a buyer, some impressions are lost at each step, usually because the process is slow and the user has moved on before the impression is filled and the ad is served. Presenting impressions to all potential buyers at the same reduces loss, meaning that the publisher will earn revenue for more impressions overall.

Diversity of buyers

There’s a saying that you shouldn’t put all your eggs in one basket; the same holds true for diversifying the demand for your inventory. Having multiple partners available to participate in an auction reduces the risk that impressions will go unfilled due to performance or technical issues. 

Working with multiple ad networks and SSPs also gives publishers more control over the price they can set for their inventory. Working with a single ad network puts that network in control over what price they’re willing to pay for an impression; working with multiple demand sources forces the price to be set by competition.

Header bidding also provides publishers with more control over which partners participate in which auction. If a partner is underperforming, publishers don’t need to reconfigure their waterfall; they can simply exclude that network or SSP from participating. Conversely, publishers can prioritize high-performing partners to ensure they’re receiving top dollar for each impression.

Are there any drawbacks?

There are some potential drawbacks to implementing header bidding and, while we believe that the benefits more than compensate for some of the disadvantages, we’ll walk through some of the potential pitfalls of header bidding.

Degraded page loading/rendering

Implementing header bidding requires adding some additional code to the header of your website, which can sometimes noticeably affect page load and rendering speed. The magnitude of impact greatly depends on how the header bidding code is implemented – in-house, older generation, or unoptimized wrappers will usually have a larger negative impact. Overall, the page impact when implemented correctly, should be on par or better than a traditional waterfall implementation. This tradeoff is worth it because publishers of all sizes typically see an enormous revenue increase by switching from a waterfall setup to header bidding – even with an unoptimized wrapper.

Management requirements

Header bidding requires more technical and day-to-day management than working with AdSense alone. Developing relationships with and monitoring the performance of each partner can be time-consuming, and you’ll likely need a dedicated in-house ad ops team to resolve discrepancies, optimize floors and timeouts, and deal with quality issues if you decide to implement and manage header bidding yourself. 

pubGENIUS offers a fully managed header bidding solution that can help publishers get up and running with header bidding, without taking on the technical and management load. If you’re interested in learning more about header bidding, and whether it’s a good option to increase revenue on your website, talk to our team for your complimentary ad ops assessment.